When Will US Aviation Taxes Come Back?

With aviation taxes suspended, last week I explained who wins and who loses, and most importantly how you can still benefit: taxes aren’t being charged on the purchase of miles from US airline frequent flyer programs, or by American Express Membership Rewards when transferring points to those programs.

Now that most airlines have raised their fares to offset price reductions from tax savings, few consumers remain rooting for the FAA re-authorization bill to remain stalled (which is why we’re on a tax holiday).

But it looks like the situation will continue throughout the month of August. National Journal reports that the House plans to adjourn for its month-long recess after tonight’s debt ceiling vote.

The partial shutdown of the Federal Aviation Administration will drag on until September because Republican leaders are planning to adjourn the House for its August recess without waiting for a bill to fund the agency from the Senate.

The Senate is preparing to pass a clean stopgap funding bill on Monday night, but it won’t become law unless the House agrees to it. The House has already passed an FAA stopgap, but it includes extra provisions on rural airport subsidies that are objectionable in the Senate.

Of course, if the Senate were to pass the same bill that has already cleared the House, the FAA would once again be operational and taxes would go back into place. But that appears unlikely.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. Thanks as always for the info. Would love to hear updates as you get them about the IRS process for refunding those – took a flight this past weekend and it would save quite a bit of $$.

  2. I think one major benefit no one seems to realize is that the credit card companies are also able to enjoy the tax holiday and they don’t have to pay 7.5% tax on purchased miles either… with the amounts of miles they purchase, the savings are enormous! so i am looking forward to some huge credit card bonuses in the coming months.

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